banf-10q_20200930.htm

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐.

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (sec. 232-405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐.

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, or a non-accelerated filer. See definition of “accelerated filer and large accelerated filer” in Rule 12b-2 of the Exchange Act.

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined by Rule 12b-2 of the Exchange Act). Yes ☐ No ☒

As of October 30, 2020 there were 32,682,269 shares of the registrant’s Common Stock outstanding.

	September 30,			December 31,
		2020			2019
	(unaudited)			(see Note 1)
ASSETS
Cash and due from banks	$	226,062		$	222,043
Interest-bearing deposits with banks		1,609,462			1,646,238
Federal funds sold		—			1,000
Securities held for investment (fair value: $3,011 and $1,903, respectively)		2,971			1,903
Securities available for sale at fair value		593,970			489,723
Loans held for sale		48,601			11,001
Loans (net of unearned interest)		6,612,093			5,662,143
Allowance for credit losses		(106,126	)		(54,238	)
Loans, net of allowance for credit losses		6,505,967			5,607,905
Premises and equipment, net		247,494			206,275
Other real estate owned		4,739			5,607
Intangible assets, net		19,914			22,608
Goodwill		149,922			148,604
Accrued interest receivable and other assets		209,766			202,851
Total assets	$	9,618,868		$	8,565,758

LIABILITIES AND STOCKHOLDERS' EQUITY
Deposits:
Noninterest-bearing	$	3,759,305		$	2,956,370
Interest-bearing		4,736,586			4,527,265
Total deposits		8,495,891			7,483,635
Short-term borrowings		300			1,100
Accrued interest payable and other liabilities		52,121			49,230
Junior subordinated debentures		26,804			26,804
Total liabilities		8,575,116			7,560,769

Stockholders' equity:
Senior preferred stock, $1.00 par; 10,000,000 shares authorized; none issued		—			—
Cumulative preferred stock, $5.00 par; 900,000 shares authorized; none issued		—			—
Common stock, $1.00 par, 40,000,000 shares authorized; shares issued and outstanding: 32,679,191 and 32,694,268, respectively		32,679			32,694
Capital surplus		155,431			153,353
Retained earnings		846,934			815,488
Accumulated other comprehensive income, net of income tax of $2,943 and $1,187, respectively		8,708			3,454
Total stockholders' equity		1,043,752			1,004,989
Total liabilities and stockholders' equity	$	9,618,868		$	8,565,758

The accompanying Notes are an integral part of these consolidated financial statements.

	Three Months Ended						Nine Months Ended
	September 30,						September 30,
		2020			2019			2020			2019
INTEREST INCOME
Loans, including fees	$	76,612		$	75,260		$	231,985		$	214,980
Securities:
Taxable		2,032			2,361			6,665			10,551
Tax-exempt		131			103			383			347
Federal funds sold		—			1			—			3
Interest-bearing deposits with banks		422			8,704			5,586			24,587
Total interest income		79,197			86,429			244,619			250,468
INTEREST EXPENSE
Deposits		2,854			13,644			16,004			40,983
Short-term borrowings		—			7			8			29
Junior subordinated debentures		491			491			1,474			1,474
Total interest expense		3,345			14,142			17,486			42,486
Net interest income		75,852			72,287			227,133			207,982
Provision for credit losses		18,740			2,758			57,656			6,875
Net interest income after provision for credit losses		57,112			69,529			169,477			201,107
NONINTEREST INCOME
Trust revenue		3,131			3,490			10,154			9,917
Service charges on deposits		19,078			19,866			54,642			56,643
Securities transactions (includes no accumulated other comprehensive income reclassifications)		—			—			(545	)		821
Income from sales of loans		1,873			964			4,215			2,530
Insurance commissions		5,197			5,535			15,316			15,220
Cash management		3,701			4,430			12,276			12,608
(Loss)/gain on sale of other assets		(15	)		(1	)		120			(12	)
Other		1,610			1,343			5,624			3,978
Total noninterest income		34,575			35,627			101,802			101,705
NONINTEREST EXPENSE
Salaries and employee benefits		41,995			40,354			123,977			112,649
Occupancy, net		4,503			3,386			11,888			8,966
Depreciation		3,795			3,268			10,830			9,268
Amortization of intangible assets		968			842			2,900			2,359
Data processing services		1,669			1,467			4,990			4,209
Net loss/(income) from other real estate owned		196			26			(1,951	)		(361	)
Marketing and business promotion		1,485			2,047			5,325			6,227
Deposit insurance		723			(81	)		1,224			996
Other		10,749			10,882			32,936			30,692
Total noninterest expense		66,083			62,191			192,119			175,005
Income before taxes		25,604			42,965			79,160			127,807
Income tax expense		4,714			9,597			14,932			28,435
Net income	$	20,890		$	33,368		$	64,228		$	99,372
NET INCOME PER COMMON SHARE
Basic	$	0.64		$	1.02		$	1.97		$	3.04
Diluted	$	0.63		$	1.00		$	1.94		$	2.98
OTHER COMPREHENSIVE (LOSS) GAIN
Unrealized (loss) gain on securities, net of tax of $335, $1, $(1,756) and $(1,979) respectively		(982	)		(26	)		5,254			5,768
Comprehensive income	$	19,908		$	33,342		$	69,482		$	105,140

The accompanying Notes are an integral part of these consolidated financial statements.

	Three Months Ended				Nine Months Ended
	September 30,				September 30,
	2020		2019		2020			2019
COMMON STOCK
Issued at beginning of period	$	32,663	$	32,640	$	32,694		$	32,604
Shares issued for stock options		16		4		44			40
Shares acquired and canceled		—		—		(59	)		—
Issued at end of period	$	32,679	$	32,644	$	32,679		$	32,644
CAPITAL SURPLUS
Balance at beginning of period	$	154,692	$	150,995	$	153,353		$	149,709
Common stock issued for stock options		306		128		813			873
Stock-based compensation arrangements		433		347		1,265			888
Balance at end of period	$	155,431	$

Oklahoma		73-1221379
(State or other Jurisdiction of		(I.R.S. Employer
incorporation or organization)		Identification No.)

101 N. Broadway, Oklahoma City, Oklahoma		73102-8405
(Address of principal executive offices)		(Zip Code)

Item		Page
	PART I – Financial Information
1.	Financial Statements (Unaudited)	2
	Consolidated Balance Sheets	2
	Consolidated Statements of Comprehensive Income	3
	Consolidated Statements of Shareholders’ Equity	4
	Consolidated Statements of Cash Flow	5

	Notes to Consolidated Financial Statements	6
2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	33
3.	Quantitative and Qualitative Disclosure About Market Risk	42
4.	Controls and Procedures	43

	PART II – Other Information
1.	Legal Proceedings	44
1A.	Risk Factors	44
2.	Unregistered Sales of Equity Securities	44
3.	Defaults Upon Senior Securities	44
4.	Mine Safety Disclosures	45
5.	Other Information	45
6.	Exhibits	46
Signatures		48

Large accelerated filer	☒	Accelerated filer	☐

Non-accelerated filer	☐	Smaller reporting company	☐

Emerging growth company	☐